‘We need tax fairness’

By Sen. Mike Stack and Rep. Mike McGeehanDec. 18, 2013

We need tax fair­ness to en­sure that tax dead­beats pay what they owe, and homeown­ers do not re­ceive yearly prop­erty tax hikes. More than a year ago, we gathered with neigh­bors in Ta­cony to push for tax fair­ness and we went to work in the Gen­er­al As­sembly. Re­cently, two bills were passed in Har­ris­burg to im­prove tax fair­ness and help hard-work­ing homeown­ers in North­east Phil­adelphia.

The two laws will not only help Phil­adelphia, they will help strug­gling cit­ies across the state by let­ting dead­beat prop­erty own­ers know that they can run, but they can’t hide, from their ob­lig­a­tion to our school chil­dren and law-abid­ing tax­pay­ers.

House Bill 388, sponsored by Philly’s own Rep. Cher­elle Park­er, al­lows mu­ni­cip­al­it­ies to put a li­en on any Pennsylvania prop­er­ties owned by a dead­beat tax­pay­er. Cur­rent law al­lows the city to put a li­en only on prop­er­ties with­in its bor­ders. This is a com­pan­ion bill to Sen. Stack’s Sen­ate Bill 467.

It’s not un­com­mon for a slum­lord to make money rent­ing a prop­erty while it de­teri­or­ates, then aban­don the build­ing and the tax bills on it. These prop­er­ties end up not worth the leg­al cost of en­for­cing the li­en, and the own­er has already moved on.

This cyn­ic­al prac­tice frac­tures neigh­bor­hoods and over­bur­dens city gov­ern­ment but, worst of all, it cheats our school chil­dren out of the edu­ca­tion they de­serve and it puts an even big­ger bur­den on law-abid­ing prop­erty own­ers.

No more.

Now, Phil­adelphia and oth­er cit­ies can put a li­en on any Pennsylvania prop­erty owned by the same busi­ness or in­di­vidu­al, which could help re­coup hun­dreds of mil­lions of dol­lars lost to de­lin­quent prop­erty own­ers.

With this new law, Philly schools have the po­ten­tial to re­ceive a $250 mil­lion in­fu­sion from late real es­tate tax­pay­ers, $90 mil­lion in tardy busi­ness in­come and re­ceipts taxes, and $50 mil­lion in over­due wage taxes.

How many books, com­puters, coun­selors and teach­ers could be ad­ded – or re­turned – to our schools with an ad­di­tion­al $390 mil­lion?

The School Dis­trict of Phil­adelphia’s budget de­fi­cit this year was about $300 mil­lion, and we all still shud­der when we think of the phrase “dooms­day budget.”

Rep. McGee­han sponsored a bill that will help people man­age their real es­tate bills and make the pay­ment of real es­tate taxes more man­age­able and fair. Rep. McGee­han’s House Bill 391 gives tax­pay­ers the op­tion of pay­ing real es­tate taxes in monthly in­stall­ments.

For many homeown­ers, prop­erty tax bills are dif­fi­cult to pay in one lump sum, and cur­rent law doesn’t al­low for a sys­tem of in­stall­ments. In ad­di­tion to spread­ing out the bur­den for tax­pay­ers, school dis­tricts could be­ne­fit from a steady stream of pay­ments rather than hav­ing to wait for a once-a-year lump sum.

We be­lieve this idea will make tax col­lec­tion easi­er for the city, the school dis­trict and the homeown­er. One of the ways we are mak­ing pro­gress in the Gen­er­al As­sembly is by show­ing law­makers from across Pennsylvania that they are not im­mune from the prob­lems fa­cing Phil­adelphia.

Even the most con­ser­vat­ive, rur­al dis­tricts have a third-class city at their core with fin­an­cial chal­lenges that are the same, with smal­ler num­bers, than what we face in Phil­adelphia.

That re­cog­ni­tion has been a long time com­ing across a wide and di­verse state. But wheth­er you live in Philly, Erie, Wil­li­am­s­port, Chester, John­stown, Altoona or Ali­quippa, you want your chil­dren to have a fair op­por­tun­ity and you want con­fid­ence that your tax sys­tem is pro­tect­ing those who abide by the law. ••